05

PART 1

Impact of COVID-19
on Vietnam’s International
Trade and Policy Responses
Le Quoc Phuong
Senior Research Fellow, former Deputy Director-General,
Vietnam Industry and Trade Information Center (VITIC)
KIEP Visiting Scholars Program
Visiting Scholars’ Opinion Paper
-
Impact of COVID-19 on
Crisis and Fragility:
Economic Impact of COVID-19
and Policy Responses
Vietnam’s International
Trade and Policy
Responses
Le Quoc Phuong
Senior Research Fellow, former Deputy Director-General,
Vietnam Industry and Trade Information Center (VITIC)

1. Introduction
COVID-19 (Coronavirus) originated from Wuhan, China in December
2019. Following this, it has rapidly spread all over the world, causing the
worst pandemic of the last 100 years. As of August 31, 2020, more than
25 million confirmed cases and 850 thousand deaths have been reported
worldwide. The toll keeps rising fast every day.

In the first COVID-19 wave in Vietnam (January ‒ April 2020), the

Government swiftly implemented measures to contain the disease. All
transport means (air, road, railways and sea) were halted, at first with
China, then with other countries. Visa provision was stopped, at first for
Chinese, then for other international visitors. Wearing a face mask became
mandatory. Home-coming Vietnamese have been quarantined for 14
International Trade days. At the first wave’s height in March 2020, a nationwide lockdown was
and Cooperation
declared for four weeks (March to April 2020).

Vietnam After a 99-day virus-free period (April ‒ late July 2020), the second wave
broke out in Danang on July 25, 2020. Almost instantly, lockdown was
2009, 2017 imposed on Vietnam’s third-largest city and other affected areas across the
country. All infected people have been traced to find potential infections. All
Lequocphuong2002@yahoo.com
people across the country who visited Danang in July 2020 have been tested.

69 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 As a result of these measures, impacts of COVID-19 on Vietnam are
rather limited. As of Aug 31, 2020, there have been 1,040 cases and 32
COVID-19-related deaths (against the population of nearly 100 million).

While Vietnam’s human losses are minimal, impacts on the country’s

economy and trade are measurable.

2. Economic Impacts of
COVID-19 Pandemic
2.1. Impacts on Global Economy

The pandemic forces countries across the world to impose lockdown.

Businesses have been closed down, factories and production lines halted.
Global supply chains (GSCs) have been disrupted, at first in China, “the
workshop of the world,” then in other countries. Major economies (such as
the US, the EU and Japan) plunged into recession.

In their June 2020 reports, both the World Bank (2020) and IMF (2020)
assert that the current recession is worse than the 2009 global crisis (Table
1). If the pandemic continues, impacts on the world would be more
devastating.

Table 1.
Global Economy in Crisis: 2020 vs. 2009

2020 (forecast)
Indicators 2009a IMFb WBc
World GDP Growth (%) -0.6 -4.9 -5,2

World Trade Volume Growth (%) -10.7 -11.9 -13.4

Commodity Prices
Oil -36.3 -41.1 -47.9
Non-fuel -18.7 0.2 -5.9
Source: a) IMF (2011), b) IMF (2020), c) WB (2020).

70 KIEP Visiting Scholars Program _ Visiting Scholars’ Opinion Paper

 2.2. Impacts on Vietnam’s Economy

Vietnam’s economy grew relatively fast in recent years, with its GDP
growth ranging between 6.2% and 7.1% for the last five years (2015‒2019).
The pandemic abruptly ended this path of development. As a highly open
economy, Vietnam has been hurt severely by this unprecedented shock.
The country has been on the world’s top list of openness as its index of
economic openness amounts to more than 200%.1 While the high index of
openness indicates Vietnam’s high level of integration with the world, it also
implies the country’s vulnerability to external shocks.

The pandemic’s impacts are more severe as Vietnam’s top economic

partners such as US, EU, China, Japan and Republic of Korea (ROK) have
been hit hard. As a result, Vietnam’s economy in the first half of 2020
deteriorated considerably compared to the same period in 2019 (Table 2).

Table 2.
Impacts on Vietnam’s Economy: First Half of 2020 vs. 2019

First Half of First Half of

Indicators 2019 2020
GDP Growth (Y-Y change, %) 6.71 1.81
Agriculture 2.19 1.19
Industry 9.14 2.98
Services 6.85 0.57

Labor market
Unemployment rate (%) 1.99 2.26
Under-employment rate (%) 1.29 2.59
Business Operation (Y-Y change, %)
Temporarily Stopped Businesses 17.4 38.2
Newly Established Businesses 38.5 14.1

International tourists (Y-Y change, %) 7.5 -55.8

Source: Vietnam’s GSO (2020a).

1. A country’s economic openness is measured by ratio of its exports plus imports over its GDP.

71 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 GDP growth for the second quarter of 2020 is lowest since the General
Statistical Office (GSO) began computing GDP growth in 1991, while GDP
growth for the first half of 2020 is lowest since 2011. All sectors of the economy
(agriculture, industry and services) contracted. Both unemployment and
under-employment in the first half of 2020 rose compared to the same
period of 2019. Number of temporarily stopped firms jumped by 38.2%
(compared to 17.4% for the same period in 2019) while number of newly
established firms increased by just 14.1% (compared to 38.5% for the same
period in 2019). Number of international tourists dramatically fell by
55.8%, reversing the uptrend in recent years (GSO, 2020a).

2.3. Impacts on Vietnam’s Trade

As a result of the export-led growth strategy Vietnam has pursued since

1986, the country’s exports surged from US$ 350 million in 1986 to US$
263 billion in 2019. Average growth of exports for 1987‒2019 is 23.3%,
one of the world’s highest rates (author’s calculation from GSO data). The
country now stands #22 in the world in terms of export size, being one
of the world’s top exporters of many agricultural products such as cashew,
rice, coffee, natural rubber and seafood, and manufactures such as garment,
footwear and furniture (Le Quoc Phuong, 2018a).

As the global economy has been devastated by COVID-19, the world’s

GDP growth, trade growth and commodity price index all look to be
negative for 2020 (see Table 2). Consequently, Vietnam’s exports have been
hurt by the fall in world demand for, and world price of, most of Vietnam’s
export products. The country’s exports slumped also due to the reduced
production capacity caused by the disruption of GSCs. In addition, border
closing worldwide prevented goods movement and trade activities.

Vietnam’s major export items such as smart-phones, garment and

footwear slumped in the first 7 months of 2020 (while for the same period
in 2019, value of all major export items increased). Exports to main markets
(namely the EU, ASEAN and ROK) plummeted (whereas for the same
period in 2019, exports to all main markets surged).

On the import side, supply of intermediate goods (much needed for

Vietnam’s largely assembly-based industry) dipped due to disruption of
GSCs. Imports from main supply sources (China, ROK, ASEAN and the
US) dropped.

72 KIEP Visiting Scholars Program _ Visiting Scholars’ Opinion Paper

 Overall, exports for the first 7 months of 2020 rose by 0.2% (the lowest figure
since the 2009 global economic crisis, and a far cry from the average export
growth of 23.3% for 1987‒2019), while imports declined for the first time since
2009 by 2.9%. Impacts on Vietnam’s trade can be clearly seen by comparing
trade data for January‒July 2020 to that for the same period in 2019 (Table 3).

Table 3.
Impacts on Vietnam’s Trade: January-July 2020 vs. 2019

Indicators (Y-Y change, %) January-July 2019 January-July 2020

Total Exports 7.5 0.2

Total Imports 8.3 -2.9

Major Exports    
Smart-phones 3.1 -6.6
Computers, electronic devices 14.9 24.1
Garment 10.5 -12.1
Footwear 13.8 -7.9
Machinery, parts 7.2 27.1

Major Imports    
Intermediate goods   -2.6
Consumer goods   -7.3

Main Export Destinations    

US 25.4 15.0
EU 0.4 -5.9
China 0.1 18.4
ASEAN 5.5 -15.4
ROK 4.4 -0.4

Main Import Sources    

China 16.9 -1.8
ROK -0.8 -9.2
ASEAN 5.2 -11.3
Japan -0.4 5.1
EU 8.6 6.0
US 8.6 -2.5

Source: GSO (2019, 2020b).

73 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 3. Vietnam’s Policy Responses
3.1. Economy-wide Responses

Facing with unprecedented shock, the Government was quick to release

responses to limit its impacts on the economy. Economy-wide responses
include stimulus and social-security packages, and a number of other
policy arrangements, which are given in the governmental documents:

・Prime-Minister’s Directive #11 of March 4, 2020 on “Urgent tasks and

measures to ease businesses’ hardship and maintain social security in
response to COVID-19 pandemic” (Vietnam’s Government, 2020a).
・Government’s Resolution #42 of April 9, 2020 on “Measures to support
people who have suffered from COVID-19 pandemic” (Vietnam’s
Government, 2020b).

Stimulus Package. Not long after the first case of COVID-19 was reported
on January 23, 2020, the Prime-Minister issued Directive #11 of March
4, 2020 (Vietnam’s Government, 2020a), which contains the largest ever
stimulus package worth some US$ 20 billion. The package aims to help
businesses survive the hard time by providing them easier access to financial
sources and reducing their business costs. Troubled companies are allowed
to postpone debt payment and social-security contributions. The package
reduces or even exempts firms from loan interests, reduces numerous fees
for businesses, and provides funds for re-training out-of-work workers.

Social-security Package. On April 6, 2020, the Government released

Resolution #42 (Vietnam’s Government, 2020b), which offers largest ever
social-security package worth $US 2.6 billion to provide support for some
20 million people affected by the pandemic, which are classified into 6
major groups:

・4 million people under social-security program.

・2 million poor households.
・3 million workers with work contract deferred and workers who have
to stay home with no pay.
・One million employers to be provided zero-interest loan for 12 months
to pay salary for out-of-work workers.
・760 thousand small-household businesses which temporarily stopped

74 KIEP Visiting Scholars Program _ Visiting Scholars’ Opinion Paper

 their operation.
・ 5 million out-of-work workers or workers with work contract
eliminated but ineligible for social security.
Recently, in light of the long-lasting pandemic, the Ministry of
Labor, Invalids and Social Affairs submitted to the Government for approval
a second package worth nearly $US 1 billion to provide additional support
for businesses and for human resources development (Nhan Dan, August
22, 2020).

Other Policy Measures. To limit the pandemic’s impacts and assist

affected businesses and people, alongside with above-mentioned packages,
the Government has implemented other measures (Vietnam’s Government,
2020a) which aim at:

・Improving business environment, thus helping businesses survive the

hard time.
・Accelerating public investment projects to stimulate demand at time of
slumping private investment.
・Reviving most hard-hit sectors (such as tourism and airlines).

It should be noted that in parallel with the economy-wide responses, the

Government has adjusted fiscal and monetary policy accordingly to avoid
rising inflation, public debt and budget deficit, possibly caused by huge
stimulus and social-security packages.

3.2. Policy Responses in Trade Sector

With regard to the trade sector, Directive #11 requires related ministries
to realize following policy measures (Vietnam’s Government, 2020b):

・Maximizing benefits of free trade agreements (FTAs), first of all the

EU-Vietnam FTA (EVFTA).
・Diversifying export destinations and import sources.
・Stepping up development of supporting industries.
・Promoting domestic markets as a complementarity for external markets.

In response to the Government’s guidelines, in June 2020 the Ministry

of Industry and Trade (MOIT), which is in charge of industrial and trade
sectors, released the “Action plan to revive and then further expand
industrial and trade sectors amid COVID-19 outbreak” (MOIT, 2020a).

75 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 The plan includes major groups of actions to realize the policy measures,
given in Directive #11.

4. Implications of Policy Measures

in Trade Sector

4.1. Maximizing Benefits of FTAs (in particular EVFTA)

Problem: unutilized opportunities of FTAs. To facilitate its export-

led growth strategy, Vietnam has been active in pursuing FTAs. To date
Vietnam has concluded 12 FTAs with its trading partners. These include:

・3 bilateral FTAs (with Japan, Chile and ROK, respectively)

・9 regional FTAs, namely AFTA (ASEAN FTA), 5 “ASEAN+1” FTAs
(ASEAN and China, ASEAN and Japan, ASEAN and ROK, ASEAN
and India, ASEAN and Australia and New Zealand), FTA between
Vietnam and EAEU (Eurasian Economic Union of Russia, Belarus,
Armenia, Kazakhstan and Kyrgyzstan), CPTPP (Comprehensive and
Progressive Agreement for Trans-Pacific Partnership between Vietnam
and 10 other economies in the Asia-Pacific region), and EVFTA.

These FTAs have been pivotal in gaining access for Vietnam’s firms to
international markets and facilitating rapid rise of the country’s exports.
However, the enormous opportunities of these FTAs have not been fully
utilized by Vietnamese companies, due largely to their low competitiveness
on global markets. In the wake of the COVID-19 pandemic, the urgent need
of maximizing benefits of FTAs has again been stressed by the Government
in Directive #11.

Among these FTAs, most notable are the newly effective CPTPP
(effective January 14, 2019) and EVFTA (effective August 1, 2020), the new-
generation and high-standard agreements, which are characterized by the
following features (Le Quoc Phuong, 2018b):

(1) Wide scope of liberalization, covering not only trade issues (trade in
goods and services, investment, intellectual property rights, trade dispute
settlement, government procurement, sanitary, technical barriers and

76 KIEP Visiting Scholars Program _ Visiting Scholars’ Opinion Paper

 other non-tariff barriers to trade) but also non-trade items (environment
protection, labor standards, trade union, reform of state-owned-enterprises
(SOEs), and support for small and medium enterprises (SMEs).

(2) New issues to deal with new challenges (innovation, productivity, role
of Internet and digital economy).

(3) Fast and comprehensive market access, with most tariff lines being
cut to zero immediately and the remaining being eliminated according to
a fast roadmap.

In particular, the EVFTA is of special importance because it took effect

amid the COVID-19 pandemic. To date, Vietnam is the only developing
country, and the second country in ASEAN (after Singapore), with which
the EU has concluded an FTA. The EVFTA is therefore expected to provide
a big push to expand Vietnam’s exports to EU’s immense markets of 27
countries with 500 million of high-income people.

Before the EVFTA came into effect, only some 40% of Vietnam’s exports to
the EU were given 0% tariffs under EU’s Generalized System of Preferences
(GSP). Now that the EVFTA took effect on August 1, 2020, 85.6% of tariff
lines (currently covering some 70% of Vietnam’s exports to EU) have been
cut to 0% immediately. By 2027, more than 99% of tariff lines (covering
nearly 100% of Vietnam’s exports to EU) will be cut to 0%.

Based on these massive tariff cut commitments, Vietnam’s Ministry of

Planning and Investment (MPI) estimated that the EVFTA would help
raise Vietnam’s exports by 42.7% by 2025 and by 44.4% by 2030 (MOIT,
2020b). However, to realize this huge potential, domestic companies should
make enormous efforts to overcome challenges posed by the EVFTA. These
include EU’s rule of origin (requiring Vietnam’s products to have certain
local contents to get preferential tariffs), high product quality requirements,
and numerous technical and sanitary standards. Moreover, to be accepted
on the EU markets, Vietnam’s products should meet strict requirements of
labor standards, environment protection, and social responsibility. Further,
Vietnam’s firms have to compete with more advanced EU companies at
home since the treaty requires Vietnam to open its domestic markets in
return for having access to EU markets.

77 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 Actions and expected effects. For effective implementation of the EVFTA,
in early August 2020 the Government released the “Action plan for EVFTA
implementation” (Vietnam’s Government, 2020c) with the following
measures:

・Provide information on the EVFTA (its contents, opportunities and

challenges) to Vietnam’s business community using all means of
communications.
・Provide information on opportunities of doing business in Vietnam
to EU business community via trade- and investment-promotion
programs.
・Build up support programs to raise competitiveness of domestic
industries and companies (particularly SMEs) in compliance with
Vietnam’s international agreements, and to assist domestic companies
in interacting with FDI companies and joining GSCs.
・Restructure industrial sector toward industrialization and
modernization and restructure agricultural sector toward a clean
production based on advanced and environment-friendly technology.

To realize the Government’s policy measures, MOIT has implemented

the following activities (MOIT, 2020a):

・Preparing scenarios for exploring opportunities of export markets

(especially the EU and other markets with which Vietnam has
concluded FTAs).
・Realizing export-promotion measures using various cooperation
mechanisms (such as inter-government commissions and joint FTA
implementation commissions).
・Providing businesses with detailed information on various certificates
which are required for Vietnam’s export products (especially to the US
and the EU).
・Preparing list of preferential export taxes and import tariffs under the
EVFTA (in collaboration with the Ministry of Finance).

Under normal conditions, these measures would help Vietnam maximize

benefits of the EVFTA. Unfortunately, as EU economies have suffered from
COVID-19, their import demand has declined. Vietnam, therefore, will
not likely be able to maximize the EVFTA’s huge potential at this time. But
once the outbreak is under control, Vietnam’s well-prepared companies are
expected to expand their exports to EU.

78 KIEP Visiting Scholars Program _ Visiting Scholars’ Opinion Paper

 4.2. Diversifying Export Markets and Supply Sources

Problem: dependency on a few external markets. Although Vietnam

has traded with some 230 out of the world’s 240 economies, most of the
country’s trade volume has been made with a few major trading partners.
In 2019, six top export markets, namely the US, the EU, China, ASEAN,
Japan and ROK (in order), accounted for some 75% of Vietnam’s exports.
Similarly, almost 80% of Vietnam’s imports came from six largest supply
sources, namely China, ROK, ASEAN, Japan, the EU and the US (in order)
(author’s calculations based on GSO data).

The dependency on a few export destinations and import sources poses

significant risk, especially when critical conditions take place in these
economies. Indeed, Vietnam’s trade considerably suffered from the Asian
economic crisis 1997‒1998 (when its major trade partners in Asia were
severely impacted), and from the global crisis 2008‒2009 (when its major
trade partners in the world were badly hurt).

Actions and expected effects. As Vietnam’s trade has been hurt by the
pandemic which devastated its major trading partners, the urgent need
of diversifying export markets and supply sources is again stressed by the
Government in Directive #11. In line with the Government’s guidelines,
various activities have been carried out as follows (MOIT, 2020a):

・Stepping up activities to gain access for Vietnam’s exports to new

markets.
・Diversifying Vietnam’s trade relations to avoid high dependency on a
few suppliers.
・Implementing activities to connect network of supply chains, and to
enhance supply chains for Vietnam.
・Adjusting the National Trade Promotion Program to reflect latest
developments in the world.

In normal circumstances, these measures would help Vietnam’s

companies to have access to new export markets and supply sources.
Unfortunately, COVID-19 has pushed down import demand and supply
capacity in many economies. It is expected that when the outbreak is over,
Vietnam’s companies will be ready to expand their exports to untraditional
markets, and to bring imports from new supply sources, thanks to these
policy measures.

79 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 4.3. Raising value-added of exports by stepping up the
development of supporting industries

Problem: low value-added of exports. As analyzed in Le Quoc Phuong

(2018a), although Vietnam’s export value has escalated since 1986, export
value-added has been low. In fact, Vietnam’s domestic value-added of
exports has been significantly lower compared to that of its neighboring
ASEAN countries such as Singapore, Malaysia, Thailand, Indonesia and the
Philippines. This is because most of Vietnam’s agricultural commodities
(including top exports such as coffee, rice and seafood) have been exported
as raw materials, while major export manufactures (including largest
exports such as smart phones, computers, garment and footwear) have
been assembled at home.

The main reason is, Vietnam’s supporting industries have been under-
developed, thus unable to provide a sufficient amount of parts and materials
for assembly-based industry. Vietnam’s firms have to import most of parts
and materials to complete products at home in the assembly stage (the
lowest value-added stage in the GVCs).

Actions and expected effects. Boosting supporting industries has been the
Government’s long-term concern. The pandemic again raises the pressing
need of this issue, as supply of intermediate goods has been disrupted due
to the devastation of the world’s main suppliers. In this context, building up
strong supporting industries would reduce dependency of domestic firms
on imports of intermediate goods, and raise value-added of their exports.

To materialize the Government’s policy measure specified in Directive

#11, MOIT, which supervises industrial sector including supporting
industries, has implemented the following actions (MOIT, 2020a):

・Implement, in a more effective way, the program to assist businesses

operating in supporting industries, and help them participate more
deeply in GSCs.
・Carry out measures to create more favorable conditions for development
of supporting industries.
・Accomplish measures to raise value-added of domestically-produced
goods.
・Draft, and submit to the Government for approval, a new decree to
replace Decree #111/2015/ND-CP of November 3, 2015 on “Expansion

80 KIEP Visiting Scholars Program _ Visiting Scholars’ Opinion Paper

 of supporting industries” (Vietnam’s Government, 2020d).
・
In collaboration with related ministries, construct new project
on “Measures to expand supporting industries for exploring new
opportunities from post-pandemic FDI wave.”

These actions are expected to accelerate the build-up of supporting

industries. With the Government’s assistance, businesses operating in
supporting industries would significantly improve their performance, thus
becoming able to supply parts and materials for other domestic industries.
This, in turn, helps reduce Vietnam’s dependency on external supplies, and
raise value-added of the country’s exports.

4.4 Promoting Domestic Markets as a

Complementarity for External Markets

Problem: under-developed domestic markets. Historically, Vietnam’s

firms have focused on exports. This is because vast international markets,
with their huge demand and high purchasing power, provide more business
opportunities than limited-size and low-income domestic markets. Only
in 2009 when the global economic crisis pushed Vietnam’s exports down
by almost 10% (for the first time since 1986), the importance of domestic
markets as a complementarity for external markets was recognized. Since
then, the program “Vietnamese give priority to made-in Vietnam products”
has been implemented to expand domestic markets.

Actions and expected effects. COVID-19 again highlights the significance

of domestic demand. Promoting a home market of nearly 100 million
people is identified by the Government in Directive #11 as one of the
effective measures to encounter negative impacts on Vietnam’s exports. In
line with the Government’s guidelines, MOIT, which oversees international
trade and the domestic market, launched a program of demand stimulation
on domestic markets (July 1 to December 31, 2020). This program includes
the following activities (MOIT, 2020c):

・“Vietnam Grand Sales 2020,” a nationwide sales program (July 1 to July

31, 2020).
・Massive media programs to promote domestic products.
・Activities to connect domestic producers, distributors and consumers.
・Sales points across the country for “OCOP” (one community one
product) to honor specialties of localities.

81 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 ・“Proudly to be Vietnam’s products,” a program to honor and recognize
domestic products.

These activities are expected to win the interest and trust of Vietnamese
customers in domestically-produced products, thus boosting domestic
markets at a time when exports plummet under the pandemic’s impacts.

5. Conclusion
The COVID-19 pandemic has devastated economies across the world and
caused global recession. Vietnam’s economy has also been hit massively.
Facing with the unprecedented outbreak, Vietnam’s Government has
implemented economy-wide policy responses to minimize its impacts on
the economy.

In regard to trade, a number of policy responses have been carried

out to revive Vietnam’s trade sector. These measures aim at maximizing
benefits of FTAs, diversifying external market structure, improving
supporting industries, and promoting domestic markets. Not only these
policy responses address the challenges posed by the pandemic, but they
also tackle with fundamental issues of Vietnam’s trade sector. In that sense,
Vietnam views COVID-19 not only as a huge negative shock to deal with,
but also as a great chance to push for measures to enhance its trade sector.

Since the COVID-19 pandemic disrupted GSCs worldwide and pushed

down world demand, these measures may not bring about desirable effects
immediately when the outbreak has been raging. But they have provided
much needed support for Vietnam’s firms to survive the hard time, and
created favorable conditions for them to recover and expand in the mid
term and long term. Once COVID-19 is put under control, domestic
companies would be ready to take full advantage of global markets.

As these measures have been actively implemented, Vietnam’s economy

and trade is expected to recover swiftly after the pandemic is over. As WB
(2020b) forecasts, in the baseline scenario (global economy recovers in the
second half of 2020), Vietnam’s economy would grow by 2.8% in 2020 and
by 6.8% in 2021. In a downside scenario (global economy recovers in 2021),
the economy would grow by 1.5% in 2020 and by 4.5% in 2021. WB (2020b)

82 KIEP Visiting Scholars Program _ Visiting Scholars’ Opinion Paper

 also predicts, as of July 2020, that Vietnam would be among the top five in
the list of 57 economies with positive GDP growth for 2020, while some 180
other economies across the world would be in recession.

The case for Vietnam to reach this tough target is quite strong. Firstly, as
the COVID-19 outbreak has been somewhat contained in Vietnam with
minimal impacts, the country could embark on early economic recovery
while most of other countries are still struggling to control the pandemic.
Secondly, Vietnam’s current macroeconomic conditions are relatively
sound, creating a favorable environment for further expansion. Lastly, as
policy responses to COVID-19 are expected to produce positive effects on
Vietnam’s economy and trade, the country will bounce back vigorously
once the outbreak is over.

83 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses
 List of References

International Monetary Fund (IMF). 2020. “A Crisis Like No Other, An

Uncertain Recovery”. World Economic Outlook Update June
2020. Available at https://www.imf.org/en/Publications/WEO/
Issues/2020/06/24/WEOUpdateJune2020 (accessed August 20, 2020).
______ . 2011. “Global Recovery Advances but Remains Uneven”. World
Economic Outlook Update January 2011. Available at https://www.
imf.org/external/pubs/ft/weo/2011/update/01/. (accessed August
20, 2020).
Le Quoc Phuong. 2018a. “Vietnam’s Low National Competitiveness: Causes,
Implications and Suggestions for Improvement”, Korea Institute for
International Economic Policy (KIEP) Working Paper 18-01, April
2018: Seoul.
______ . 2018b. “The Rise of New Protectionism: How It Will Impact Vietnam
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______ . 2020a. Vietnam’s Socio-economic Situation in the First Half
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______ . 2020b. Vietnam’s Socio-economic Situation in the First 7
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______ .  2020a. Prime-Minister’s Directive #11/QĐ-TTg of March

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 4, 2020 on “Urgent Tasks and Measures to Ease Businesses’
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85 PART 1 _ 05. Impact of COVID-19 on Vietnam’s International Trade and Policy Responses